Bad to hold same fund in 401k and Roth IRA?

[red92s]

Currently my 401k is predominantly invested in the Vanguard 2045 retirement fund, with the remainder in Dodge & Cox International Stock. I'm under the impression that if you are going to go with one of the target retirement funds, there is less need to buy a "little of this, little of that" (?)

I'm looking at opening a Roth IRA through Vanguard. Because of their fund minimums ($3k on most funds for initial purchase), I'll only be able to start off with one fund. Would it be ill-advised to select the same 2045 retirement fund? Considering my relatively young age (25) should I look into a different growth-oriented fund like the following instead?

-Total Stock Market Index (VTSMX)
-Diversified Equity (VDEQX)
-Total International Stock Index (VGTSX)
-Vanguard LifeStrategy Growth Fund (VASGX)

[disneysteve]

I don't think there is anything wrong with owning the same fund in more than one account. I do that myself.

What matters, ultimately, is if your asset allocation is where you want it to be overall, not just in each individual account.

[Taribor]

Targeted funds are diversified enough that you should be ok. More personal preference than risk.


Personally, I have my 401(k) in a targeted fund and that, (along with my pension), will be my core retirement. It is hands off and I let the experts handle it for me.

Knowing this, I use my self-directed Roth Brokerage to buy riskier investments (individual stocks, more volatile funds, etc) and I don't mind buying/selling for small percentage gains often, as the gains are tax free. I've done very well with that style in this market. More importantly, if it were to ever tank, I am still covered with my pension/401(k). Just another take on it... It's all about how comfortable you are with risk and managing/not managing your own investments.

[sweeps]

red: Owning TR2045 in both your 401k and Roth is totally reasonable.

[red92s]

Targeted funds are diversified enough that you should be ok.

Personally, I have my 401(k) in a targeted fund and that, (along with my pension), will be my core retirement. It is hands off and I let the experts handle it for me. use my self-directed Roth Brokerage to buy riskier investments .

I'd be fine subscribing to a strategy like this (and probably actually enjoy it). Until I have a larger amount to invest to meet minimums on multiple funds, I'll probably stick to more diversified funds. I guess looking into the Fidelity Easy Start IRA's with lower minimums could be advantageous.